German City Built on Car Parts Looks to Uncertain Future

Located on the shores of picturesque Lake Constance near Austria and Switzerland, the German city of Friedrichshafen has for centuries been an industrial hub, with ZF Friedrichshafen AG among the companies anchoring its considerable wealth. For years, the world’s third-biggest car parts maker – and the region’s biggest employer – made it possible for Friedrichshafeners to live comfortably. There were well-paying jobs, affordable childcare, and amenities including an international airport and one of the country’s few private liberal arts colleges.

In the past decade, however, the 63,000-person city’s fortunes have changed. Competition from China and slower-than-expected EV uptake have battered Germany’s automotive sector, and in Friedrichshafen, ZF has taken a hit. In 2024, the company announced plans to cut up to 14,000 workers by 2028 – more than one in four of its 54,000 German employees. As the city is the majority owner of ZF, and the main recipient of its dividends, the company’s economic struggles have become Friedrichshafen’s.